Written answers

Tuesday, 19 October 2010

Department of Enterprise, Trade and Innovation

Redundancy Payments

9:00 am

Photo of Pat BreenPat Breen (Clare, Fine Gael)
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Question 514: To ask the Minister for Enterprise, Trade and Innovation when a person (details supplied) in County Clare will be facilitated; and if he will make a statement on the matter. [37094/10]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social Protection. There are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent and/or in receivership/liquidation.

I wish to advise the Deputy that on the basis of valid claims entered in the Redundancy Payments System in my Department, there is no record of a redundancy claim having been received in respect of the individual in question. It is my Department's practice not to enter incomplete claims on the system as these claims cannot be processed until the necessary documentation is submitted. Forms are returned to allow missing details and/or supporting documentation to be submitted. Submission of correctly completed Redundancy claim forms (RP50's) with all of the required documentation greatly facilitates the processing of claims.

Under Redundancy legislation the onus, in the first instance, is on the employer to pay to the employee their redundancy entitlements. The employer is then entitled, by virtue of pay related social contributions to the Social Insurance Fund, to recover 60% of the amount paid to the employee. In circumstances where the employer is unable to pay the redundancy entitlements, a claim can be lodged with the Department and the documentation required in support of lump sum claims is evidence of the employer's inability to pay the redundancy entitlements to the employees. This involves requesting a statement from the company's Accountant or Solicitor attesting to the inadequacy of assets to make the redundancy payments and, the latest set of financial accounts for the company. The employer is also asked to admit liability for the 40% liability attaching to the company arising from the redundancy payments.

If this information is provided to the Department, the employees are paid their redundancy entitlement from the Social Insurance Fund. Upon payment, the Department pursues the company for the 40% share that the company would ordinarily have been expected to pay to the employees. If the necessary supporting documentation required from the employer is not provided to my Department, the employee will be advised by my Department to take a case to the Employment Appeals Tribunal (EAT) against the employer to seek a determination establishing the employee's right and entitlement to redundancy. Once such a determination is available, the Department is then in a position to make the payment to the employee concerned. Should the outstanding documentation be provided by the employer during the period while the case is pending a hearing before the EAT, this would allow the claim to be processed by my Department in the usual way.

Photo of Jack WallJack Wall (Kildare South, Labour)
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Question 515: To ask the Minister for Enterprise, Trade and Innovation the reason a person (details supplied) in County Kildare has not being paid their redundancy payment; if the Department has received all documents regarding the redundancy or if there is any outstanding documents needed to determine the application; and if he will make a statement on the matter. [37128/10]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social and Family Affairs. There are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent and/or in receivership/liquidation.

I can confirm that my Department received a statutory redundancy lump sum claim on the 1st December, 2009 in respect of the above individual indicating his employer terminated his employment on the 2 October, 2009. In the course of processing the claim, queries have been raised with the employer. I understand that my Department has recently been in contact with the employer regarding the outstanding matters. The claim will be processed for payment as soon as these queries are resolved.

Redundancy payments are calculated by my Department on the basis of the information provided on the statutory redundancy claim form (RP50) confirmed by the signatures of the employer and employee. In the event of a dispute between the employer and the employee concerning the employee's right to a correct lump sum, the employee may decide to bring the matter to the Employment Appeals Tribunal (EAT) for adjudication. If the Tribunal rules in favour of an employee, and if the employer continues to refuse to pay the amount due, the employee should then send a copy of the EAT Decision, together with the RP50 form to the Department for payment of the lump sum from the Social Insurance Fund.

Photo of Brendan HowlinBrendan Howlin (Wexford, Labour)
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Question 516: To ask the Minister for Enterprise, Trade and Innovation the date on which an application for redundancy payments was received in his Department in respect of a person (details supplied); the reason this application has not been processed to completion in view of the fact that the company is insolvent; when the person will receive their entitlement; and if he will make a statement on the matter. [37133/10]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social Protection. There are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent and/or in receivership/liquidation.

I can confirm to the Deputy that a redundancy lump sum claim was received by my Department in respect of the individual concerned on 20 August 2009. In the course of processing the claim, my Department requested from the former employer evidence of inability to pay but does not appear to have received any response to this correspondence. In light of the time lapse since receipt of the claim by my Department and that no progress has been made on the issues arising on the claim, it would perhaps be best at this point if the claimant could make direct contact with the Redundancy Payments Section of my Department. I am providing the Deputy's office with the contact details of the relevant officer in my Department.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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Question 517: To ask the Minister for Enterprise, Trade and Innovation when redundancy payment will issue to a person (details supplied) in County Laois; and if he will make a statement on the matter. [37188/10]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social and Family Affairs. There are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent and/or in receivership/liquidation.

I can confirm that my Department received a statutory redundancy lump sum claim on 8 September, 2010 in respect of the above individual and that the claim awaits processing. In this case, I understand that my Department has already raised some queries with the employer in advance of processing the claim. In respect of lump sum payments paid directly to employees in instances where employers are unable to pay the statutory redundancy entitlements, the current processing time for these claims has improved and claims dating from March 2010 are currently being processed. Of course in some instances, where the necessary supporting documentation for lump sum claims is not provided to my Department, or where queries arise, processing of claims can be further delayed until the required documentation is provided and/or outstanding queries are resolved.

My Department continues to make every effort to reduce processing times. Measures already taken in the Department to alleviate the pressures on the Payments area include:

· Almost doubling the number of staff working solely on redundancy payment claims through reassignment to a current level of 52 full time equivalents;

· Prioritisation of the Department's overtime budget towards staff in the Section to tackle the backlog outside normal hours;

· Establishment of a special call handling facility in NERA to deal with the huge volume of telephone calls from people and businesses concerned about their payments;

· Better quality information relating to current processing times on the Department's website;

· Engagement with the Revenue Commissioners to facilitate the offset of redundancy rebate payments by employers against existing outstanding tax liabilities which those employers owe to the Revenue Commissioners.

The backlog and waiting times remain at unacceptable levels. However, improvements are evident. In 2009, my Department processed 50,664 claims, up 70% on the previous year. Furthermore, the level of new claims processed in the first nine months of 2010 was 58,202 – up over 81% on the corresponding 9-month period in 2009 (32,127) and surpassing the total amount of claims processed for the full year 2009 which came to 50,644. The backlog of claims is decreasing - reducing from its highest level in November 2009 of 43,608 to a current level of 29,776.

Responsibility for the payment functions arising under the Redundancy and Insolvency payment schemes is due to be transferred to the Department of Social Protection with effect from 1 January 2011. In transferring the functions between Departments, it is the intention that this will operate seamlessly and without any adverse impact on the service levels being experienced by individuals or the business community awaiting payment of redundancy claims.

Photo of Caoimhghín Ó CaoláinCaoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
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Question 518: To ask the Minister for Enterprise, Trade and Innovation the reason for the delay in processing the applications for redundancy payment from the social insurance fund and for unpaid wages under the insolvency payments scheme in respect of a person (details supplied) in County Cavan; if he will expedite this application in view of the amount owed; and if he will make a statement on the matter. [37289/10]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social and Family Affairs. There are two types of payment made from the SIF – rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent and/or in receivership/liquidation.

I can confirm that my Department received a statutory redundancy lump sum claim on 28 April, 2009 in respect of the above individual. A query arose in regard to the individual's eligibility under the Social Welfare Acts that has since been resolved. In the course of processing the claim, a further query has been raised with the employer. I understand that my Department has recently been in contact with the employer regarding the outstanding matter. The claim will be processed for payment as soon as this query is resolved.

My Department also received an application under the Insolvency Payments Scheme in May 2009 from the individual in question in respect of arrears of holiday pay, arrears of wages and minimum notice. Claims under the Insolvency Payments Scheme can only be processed if an employer is legally insolvent within the definition of the Protection of Employees (Employers' Insolvency) Act 1984, and certified by a "Relevant Officer" normally a liquidator or receiver. This application was not certified by a Relevant Officer and the Companies Registration Office records confirmed that the company was not in liquidation. Unfortunately, in these circumstances my Department is not in a position to process the claim and the claim was returned to the applicant.

Should the individual wish to seek further advice in relation to the pursuance of her outstanding entitlements against her former employer, she may wish to contact the National Employment Rights Authority (NERA), for further advice at Lo-call 1890 80 80 90.

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